Plan to privatize seaport operator opposed
JAKARTA (JP): Three business associations called on the government on Friday to cancel plans to privatize seaport operator PT Pelindo II and its affiliates.
The Indonesian Importers Association, the Federation of Indonesian Exporters and the Indonesian Textile Association stated that the privatization of Pelindo would benefit only investors while burdening port users with higher tariffs.
The chairman of the importers association, Amirudin Saud, said the three associations submitted their letter to President B.J. Habibie and State Minister of the Empowerment of State Enterprises Tanri Abeng.
"We want the government to cancel the privatization of Pelindo. We will fight for that," he said.
Pelindo II operates the country's busiest port, Tanjung Priok in North Jakarta,
Amirudin contends that ports are vital infrastructure for the country's economy and therefore the government should continue to manage ports through Pelindo.
The government should not turn Pelindo into a profit-oriented company by inviting strategic investors into the company, according to Amirudin.
"Foreign investors who invest here want huge profits from their investments. To achieve this, they will raise all the tariffs," he said.
The secretary-general of the exporters association, Toto Dirgantoro, said the existing tariffs at the port were already burdensome for both exporters and importers.
Any increase in port tariffs will eventually affect Indonesia's international trade, he stated.
"So we urge the government to cancel the privatization of Pelindo," he added.
Six foreign shipping companies and port operators have submitted bids to purchase between 49 percent and 51 percent of the newly established PT Jakarta International Container Terminal (JICT), an affiliate of state-owned port operator PT Pelindo II.
The six bidders are Denmark's A.P. Moller Group, which operates Maersk Lines; Grosbeak PTE Ltd., which is a unit of Hong Kong's Hutchison Whampoa conglomerate; Australia's P&O Ports; Stevedoring Services of America, which has business ties with local shipping company PT Samudera Indonesia; Taiwan's Peony Investment S.A., a unit of the Evergreen Group; and the Philippines' International Container Terminal Services Inc.
JICT, which operates two container terminals with a total capacity of 1.5 million twenty-foot equivalent units in Tanjung Priok, accounted for 50 percent of Pelindo's Rp 200 billion (US$23.5 million at the current exchange rate) in profits in 1997.
Seaport operator PT Pelindo II is one of five state-owned companies to be privatized by the government by the end of the current fiscal year ending in March 1999.
The government, which successfully privatized cement maker PT Semen Gresik last year, initially planned to raise some $1.5 billion by privatizing 12 state-owned companies during the current fiscal year, but scaled the number down to six companies because of the bearishness of the country's battered financial market. (aly)